History tells us about half of marriages in Canada end in divorce. Andrew and Sara are about to end theirs and are concerned about the changes that will have to be made to their financial and estate plans. Some financial and estate issues they need to consider are:
Number One - Buying too much on credit.
Now may be the perfect time to teach your children about financial independence. There are plenty of real-life examples in the media of how not' to manage your finances. To really teach children money management skills, they must learn to handle money personally and to make consequential decisions on how to manage it.
The neighbors have a shiny new sport utility vehicle to tow their travel trailer. They take a two week tropical vacation every winter. Their family room is equipped with the latest large screen TV and surround sound stereo system. Many people believe this is a sign of wealth. In fact, this is usually a sign of consumption.
More often than not, the above lifestyle is funded with huge amounts of debt.
As the sovereign debt crisis makes its way around the world, creating havoc in its wake, we can be thankful that Canada has weathered the storm in fairly good shape. The media has given us a play-by-play on the action and many people are concerned with the outcome. While we can't solve the sovereign debt crisis individually, we can focus on our own financial situation. Here are 5 keys for achieving sanity in your personal finances:
Reduce Your Debt
With so many doom & gloom news headlines, it is refreshing to know Canadians can still get very low fixed rate mortgages. A recent Financial Post article (March 9, 2012) explains that with big banks competing strongly for new mortgage business, now is a great time for Canadians to refinance their mortgages to improve personal cash flow.
Some financial decisions get made without enough thought given to the long term consequences. Here are some financial mistakes you can avoid:
Mortgage amortized too long:
With lenders offering 30 year amortization periods, it may look attractive to go with a smaller monthly payment to get into a larger house, but the extra interest charges only benefit the lender.
A recent TD Canada Trust survey found that 10% of Canadians are considering the purchase of a condominium for their adult children. This is up from 5% just a year earlier and certainly reflects drastically increasing housing costs over the past decade.
These days, having a career presents many new rewards and far more challenges than it ever used to. What we used to take for granted, including our work location, has changed dramatically as companies continue to grow and even go global.
This can be great for a business and its bottom line, but really tough on the employees within it. Because we never know exactly what the future holds, you may find yourself facing a job transfer at some point along your career path.
Jack and Diane want to improve their financial situation and feel that making financial New Years resolutions and implementing them is a good start. To help identify their priorities, they made the following list:
Set Objectives - Goal setting is the foundation of achieving financial success. If they write down their goals, it will help Jack and Diane clarify them and establish their personal and financial priorities.
